Top 10 UK steel contractors | results and analysis

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The economic storm continues to savage the steel sector. Which of the survivors will stay above water?

A number of big steelwork names have been claimed by the economic troubles of the past three years.

Any thoughts that good times may be round the corner were dashed last year with the collapse of S Robinson and Barratt.

And the general view is that the storm will continue to ravage the UK constructional steel market for another 18 months at least, after what one firm described as a “horrible year”.

Collectively, the turnover of the 10 biggest UK steel contractors was only down by 2% to £754m. But worryingly, discounting Mabey's figures which are distorted by divestments, the combined profit was down by more than two thirds. Little wonder that many complain of 'suicide bidding'.

Rank by turnover

Rank by profit

Company

Latest turnover (£m)

Previous turnover (£m)

Latest pre-tax profit (£m)

Previous pre-tax profit (£m)

Latest margin (%)

Previous margin (%)

Latest reporting period

1

2

Severfield Rowen

267.8

266.7

10.1

15.3

3.8

5.7

31/12/11

2

3

William Hare

182.2

154.1

1.5

6.2

0.8

4.0

31/12/10

3

1

Mabey Bridge

64.6

55.7

34.4

-1.2

53.3

-2.2

30/09/11

4

8

Billington Structures

39.4

55.7

0.2

4.2

0.5

7.5

31/12/10

5

10

Rowecord

38.0

52.9

-4.7

0.2

-12.4

0.4

30/06/11

6

5

Bourne Group

37.6

36.5

0.9

1.8

2.4

4.9

31/10/11

7

4

Cleveland Bridge

37.2

65.3

1.2

5.2

3.2

8.0

31/12/10

8

9

Caunton

32.2

29.4

0.1

0.0

0.3

0.0

31/01/12

9

7

Walter Watson

30.4

29.0

0.4

-0.4

1.3

-1.4

31/12/10

10

6

John Reid & Sons

25.4

24.2

0.7

2.4

2.8

9.9

31/03/11

Totals / Averages

754.8

769.5

44.8

33.7

5.6

3.7

Severfield Rowen remains the biggest UK steel contractor, with revenue steady at £267.8m, but profit dropping 34% to £10.1m. The firm can boast a UK order book of £221m despite the “ongoing challenges of a subdued domestic market”, but debt at year end had more than doubled from £15m to £31.1m.

William Hare enjoyed an 18% rise in revenue to £182.2m, but paid the penalty with profit dropping to just a quarter of the previous year's figure. The Bury-based contractor reduced head count by 61 to 1,512 during the year, but considers itself “well placed” and “confident about international diversification”.

Mabey Bridge, whose turnover climbed 16% to £64.6m, made £41.8m from the sale of its subsidiaries Mabey Support Systems, Mabey & Johnson, and Fairfield Mabey to holding company Mabey Engineering, plus Severn Crossing Developments to Beachley Property. This revenue partially hid a “disappointing” operating loss of £4.1m. Mabey however is “optimistic” about its prospects after investing £1.6m in a wind turbine tower manufacturing facility.

Billington's revenue took a big hit, dropping 26% on its previously set of results for 2009. Profit dived from £4.2m to just £0.2m. Blaming “overcapacity in the sector”, the firm was “expecting a much poorer performance in 2011”.

Rowecord also experienced a substantial drop in turnover, which crashed almost 40% to £38m. Alarmingly, the South Wales business posted a £4.7m loss. The directors believe Rowecord, and the steel industry generally, is in “a period of consolidation”.

One of the industry's blue ribbon names, Cleveland Bridge, suffered the worst fall in revenue in the sector, a 42% drop to £37.2m. Profit at the Al Rushaid-owned firm, which dates from 1877, plunged from £5.2m to £1.2m.

Bourne managed to hold turnover steady, despite profit falling by half in what it described as a “horrible year”. The directors pointed the finger at “cut throat competition” with “projects won by companies at negative margins”. They see “no immediate sign of recovery for 12-18 months”. Bourne says it “refuses to engage in suicide bidding and has an excellent cash position of £8m”.

Caunton and Walter Watson both managed marginal increases in revenue, though the former expects the market to stay “flat till 2014”.

John Reid, which also lifted turnover, has prioritised a “programme of planned growth” for 2011/12.